Shell Sanctions Whale Deepwater Development in Gulf of Mexico

Oil major Shell has reached a final investment decision for its Whale deepwater field development in the U.S. Gulf of Mexico.

Discovered in 2017, Whale will feature a semi-submersible production host in more than 8,600 feet (2621 meters) of water with 15 oil-producing wells.

The floating production unit will, when it comes to the hull, be a 99% replica of Shell's Vito project. The topside will be an 80% replication of the topsides from Vito,  a four-column semi-submersible host facility located in the greater Mars Corridor. Vito is scheduled to begin production in 2022.

"Whale is the latest demonstration of our focus on simplification, replication and capital projects with shorter cycle times to drive greater value from our advantaged positions,” said Wael Sawan, Shell Upstream Director. “We are building on more than 40 years of deep-water expertise to deliver competitive projects that yield high-margin barrels so that we are able to meet the energy demands of today while generating the cash required to help fund the development of the energy of the future.”

Whale will be the second Shell-operated deep-water development in the Gulf of Mexico to employ a simplified, cost-efficient host design. 

"With this development approach, Shell anticipates an internal rate of return estimated to be greater than 25%. Our Whale development will feature energy-efficient gas turbines and compression systems. This development will be the latest addition to our Gulf of Mexico portfolio where our production is among the lowest greenhouse gas (GHG) intensity in the world for producing oil," Shell said.

The Whale development is 60%-owned and operated by Shell Offshore Inc. (60% operator). Chevron, as a partner, owns 40%.

The field is expected to start production in 2024, with the expected peak output of around 100,000 barrels of oil equivalent per day (boe/d). The field currently has an estimated, recoverable resource volume of 490 million boe.

To be located in the Alaminos Canyon Block 773, adjacent to the Shell-operated Silvertip field, about 10 miles from the Shell-operated Perdido platform and approximately 200 miles southwest of Houston, Whale will be Shell’s 12th deepwater host in the Gulf of Mexico.